92 Decision Citation: BVA 92-26813
Y92
BOARD OF VETERANS' APPEALS
WASHINGTON, D.C. 20420
DOCKET NO. 83-09 080 ) DATE
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THE ISSUE
Entitlement to a waiver of the recovery of an overpayment of
pension benefits, in an amount calculated as $8,428.27,
pertaining to pension benefits paid to the veteran from
September 1, 1979, through December 31, 1981.
REPRESENTATION
Appellant represented by: Public Advocate for Veterans
Affairs, Puerto Rico
ATTORNEY FOR THE BOARD
D. Dean, Counsel
INTRODUCTION
The appellant served on active duty in the Armed Forces
during the Korean Conflict.
In late January 1982, action was taken by the San Juan,
Puerto Rico, Regional Office (hereinafter the RO) of the
Department of Veterans Affairs (VA) to retroactively
terminate the appellant's award of disability pension
benefits, effective January 1, 1981. This action resulted
in the creation and assessment against the appellant of an
overpayment, calculated as $7,259.39, representing
disability pension benefits paid to him from January 1,
1981, through December 31, 1981. The aforementioned
overpayment of pension benefits to the appellant was
considered to be directly caused by his failure to timely
report to the RO the receipt of Social Security benefits by
himself and other members of his family. The appellant's
request for a waiver of the recovery of the aforementioned
indebtedness was denied by the Committee on Waivers and
Compromises (hereinafter the Committee) at the RO in October
1982, and the appellant's notice of disagreement with that
action was received later in that same month. A statement
of the case was issued to the appellant in December 1982,
and his substantive appeal was received later in that same
month. The case initially arrived at the Board of Veterans'
Appeals (hereinafter the Board) in April 1983.
In a decision entered in January 1984, the Board remanded
this appeal to the RO for further evidentiary development.
A supplemental statement of the case was issued to the
appellant in September 1986, and the case was returned to
the Board in November 1986. In February 1987, the Board
again remanded this appeal to the RO. In accordance with
the veteran's request, he was scheduled to appear at a
personal hearing to be held at the RO in March 1988.
However, in a written statement dated March 10, 1988, the
appellant withdrew his request for a personal hearing.
In April 1989, the veteran's award of disability pension
benefits was again retroactively adjusted in order to comply
with more accurate information recently received by the RO
concerning the amounts of Social Security benefits received
by the veteran and members of his family. As a result of
that action, the overpayment assessed against the veteran
was increased to $8,428.27, representing a portion of the
pension benefits paid to the veteran from September 1, 1979,
through December 31, 1981. In a letter dated May 12, 1989,
the RO informed the veteran of the increased amount of the
overpayment assessed against him and provided a comprehensive
explanation to him of the calculation of the amount by which
he had been overpaid pension benefits. The veteran has
never expressed any disagreement with any of the calculations
set forth in that letter of May 12, 1989.
Another supplemental statement of the case was issued to the
appellant in June 1989, and the case was returned to the
Board in September 1989. In a decision entered on
December 26, 1989, another Section of the Board denied the
appellant's waiver request on the grounds that his own
material fault had directly caused the overpayment to him of
pension benefits. Unfortunately, this decision by another
Section of the Board did not reflect the newly-enacted
provisions of Section 311 of Public Law 101-237, which
became law on December 18, 1989. Accordingly, the case was
recalled to the Board in March 1990. In a decision entered
in April 1990, another Section of the Board vacated its
prior decision of December 26, 1989. In another decision
entered in the same month, this Section of the Board
remanded this appeal to the RO in order to have the
appellant's waiver request considered under the provisions
of Section 311 of Public Law 101-237.
In April 1991, a supplemental statement of the case was
issued to the appellant, reflecting the denial of his waiver
request by the Committee under the provisions of Public
Law 101-237. The evidentiary record returned to the Board
in May 1992 does not reflect a formal, written record of the
Committee's decision in April 1991. However, in view of the
age of the present appeal, as well as the fact that the
veteran has not objected to this procedural error, and in
view of the fact that the April 1991 supplemental statement
of the case did, in fact, adequately inform the veteran of
the reasons and bases for the Committee's decision, it is
felt by section of the Board that no further delay is
warranted in the appellate review of this claim because of
the Committee's failure to produce a formal, written record
of its decision in April 1991.
Throughout this appeal, the veteran has been represented by
the Public Advocate for Veterans Affairs of the Commonwealth
of Puerto Rico (formerly the Bureau of Veterans Affairs),
and that organization submitted VA Form 1-646 (Statement of
Accredited Representative in Appealed Case) in January 1983,
August 1989, and September 1991, but offered no written
argument then.
CONTENTIONS OF APPELLANT ON APPEAL
Essentially, the veteran contends that the Committee
committed error in denying his waiver request. He contends
that he had no knowledge of VA laws and regulations which
required him to report all sources of income received by
himself and his family members to the RO. He also contends
that he has no knowledge of the English language, and that
all letters sent to him by the RO were in English. He
therefore contends that he took all official papers and
forms to a "Contact Div." and that individuals at that
office completed all official documents from information
supplied by the veteran. He contends that he always acted
in good faith and attempted to supply to the RO all the
award letters from the Social Security Administration which
the RO requested.
DECISION OF THE BOARD
In accordance with the provisions of 38 U.S.C.A. § 7104
(West 1991), following review and consideration of all
evidence and material of record in the veteran's claims
file, and for the following reasons and bases, it is the
decision of the Board that the preponderance of the evidence
is against the claim seeking a waiver of the recovery of an
overpayment to the veteran of pension benefits in an amount
calculated as $8,428.27.
FINDINGS OF FACT
1. All relevant evidence necessary for an equitable
disposition of the veteran's appeal has been obtained by the
RO.
2. The appellant was overpaid disability pension benefits
in an amount calculated as $8,428.27, during the period from
September 1, 1979, through December 31, 1981, as the direct
result of his failure to timely report the receipt of Social
Security benefits by himself and members of his family to
the RO despite several written instructions to do so.
3. Neither the veteran, a member of his family nor any
other person acting on his behalf ever requested the RO to
assist him with regard to his pension benefits, either on
the grounds of mental incompetence or because of his alleged
inability to understand English.
4. The veteran has failed to respond to a written request,
dated July 12, 1990, from the Finance Officer at the RO to
submit evidence of his current financial status in support
of his waiver request.
5. The evidence of record does not show that requiring
recovery of the aforementioned indebtedness from the
appellant would result in financial hardship.
CONCLUSION OF LAW
The appellant must repay to the Government his pension
indebtedness in an amount calculated as $8,428.27, plus
accrued fees and interest. 38 U.S.C.A. §§ 1521, 5107, 5302
(West 1991); 38 C.F.R. §§ 1.963, 1.965, 3.23, 3.271, 3.272,
3.273 (1991).
REASONS AND BASES FOR FINDINGS AND CONCLUSION
Initially, we note that we have found that the appellant's
claim is well-grounded within the meaning of 38 U.S.C.A.
§ 5107(a). That is, we find that he has presented a claim
which is plausible, if not conclusive, and which is capable
of substantiation. After reveiwing the record, we are also
satisfied that the relevant facts have been properly
developed and that no useful purpose would be served by
remanding the case with directions to provide further
assistance to the appellant.
Entitlement to improved pension benefits is subject to
several requirements, including a maximum income
limitation. 38 U.S.C.A. § 1521. Moreover, even if
countable income falls below the maximum income limit, the
pension award must be offset on a dollar-by-dollar basis by
such countable income. 38 C.F.R. §§ 3.271, 3.272, 3.273.
In general, payments of any kind from any source shall be
counted as income during the 12-month annualization period
in which received unless specifically excluded. 38 C.F.R.
§ 3.271. There is no specific exclusion pertaining to
Social Security disability or retirement benefits.
38 C.F.R. § 3.272. In the case of a married veteran, the
veteran's countable income for pension purposes includes the
annual income of the veteran's dependent spouse and any
dependent children (defined as unmarried children of the
veteran, either under the age of 18, or under the age of 23
and still attending school). 38 U.S.C.A. § 101(4) (West
1991); 38 C.F.R. § 3.23 (1991).
In April 1979, an Income--Net Worth and Employment Statement
(VA Form 21-527, May 1975 edition) was received from the
veteran and accepted by the RO as a claim for disability
pension benefits. The instructions attached to that form
reflected the following directions:
IMPORTANT
THE TOTAL AMOUNT AND SOURCE OF ALL INCOME
RECEIVED SHOULD BE REPORTED, AND WE WILL
COMPUTE THE AMOUNT THAT DOES NOT COUNT.
In box No. 21 and part VI of the aforementioned VA
Form 21-527, the veteran truthfully reported that neither he
nor any member of his family was currently in receipt of
Social Security benefits. However, in box 19 on that form,
the veteran erroneously reported that neither he nor his
spouse might be entitled to receive Social Security benefits
during the present year (1979), or during the following
year; he then left blank box No. 20 in which he was asked to
indicate the date on which he had applied for, or soon would
apply for, Social Security benefits. It was subsequently
established, and the veteran no longer denies, that he was
awarded Social Security benefits, effective from
December 1978 (indicating that a claim for those benefits
had been filed and was pending no later than that month),
receiving his first payment of Social Security benefits
(including a large retroactive payment) in August 1979.
This award also included additional amounts for the
veteran's spouse and three dependent children. It has also
been subsequently established, and the veteran does not
dispute, that his wife began receiving an increased payment
of Social Security benefits in her own right, effective from
March 1981, with the first payment (again including a
substantial retroactive payment) being received by her in
October 1981.
By rating action dated in June 1979, the veteran was held to
be permanently and totally disabled for pension purposes due
to a number of disabilities, including a depressive
neurosis, rated by the RO as 50 percent disabling. It was
further specified, however, that the veteran was found to be
competent to handle his own financial affairs. Neither the
veteran, a member of his family nor any other person acting
on his behalf ever requested the RO to appoint a custodian
for the veteran in order to handle his pension benefits.
At approximately the same time (June 1979) the veteran was
requested by the RO to submit current information concerning
the income of himself and his family members. He was
specifically instructed at that time that, if "you, your
spouse and children are awarded Social Security or any other
retirement benefits, notify this office immediately."
The veteran signed a Statement of Income and Net
Worth--Disability (VA Form 21-6897, November 1978 edition)
on June 30, 1979. On that form, he again reported that
neither himself nor any member of his family derived any
income from any source whatsoever. He also indicated that
no member of his family, including himself, expected to
receive any income during the following year (1980) from any
source, including Social Security. Based upon the
aforementioned income information, the veteran was awarded
disability pension benefits, effective from April 1979,
based upon no countable income. He was notified of the
initial terms and conditions of his award by letter dated in
December 1979 (VA Form 21-6896, August 1979 edition).
Instructions on the back of that form informed the veteran
to promptly notify the RO of any change in income or net
worth for himself or his dependents. He was told that a
failure to promptly notify the RO of any such changes could
result in an overpayment which would be subject to
recovery. Finally, he was again instructed that, when
reporting income to VA, the total amount and source of all
income received should be reported, and that the RO would
compute any amount which did not count. Similar
notifications (on VA Form 21-6896, March 1980 edition) were
again sent to the veteran in November 1980 and May 1981.
On the veteran's Annualized Income Questionnaire, signed in
November 1980, he reported that neither he, his spouse nor
any of his children derived any income from any source,
specifically including Social Security benefits. Based upon
the aforementioned information, the veteran's award of
pension benefits was continued for another year based on no
countable income.
As previously mentioned in this decision, the veteran
received his first payment of Social Security benefits (a
large retroactive payment) in August 1979. Nevertheless, he
did not report the receipt by himself and his family members
of Social Security benefits to the RO prior to signing
another Annual Income Questionnaire on October 30, 1981.
Even then, he erroneously reported that none of his children
were receiving Social Security benefits. The veteran
continued to be erroneously paid pension benefits based upon
no countable income through December 31, 1981. The RO has
now determined, and the veteran has not disputed, that he
was overpaid pension benefits in an amount calculated as
$8,428.27 because of the unreported Social Security benefits
received by himself and his family members during the period
of time from September 1, 1979, through December 31, 1981.
The veteran has requested that the Government waive the
recovery from him of his pension indebtedness. The
Committee has apparently determined that the overpayment to
the veteran of pension benefits which is the subject of the
present appeal did not directly result from fraud,
misrepresentation or bad faith on his part, any of which
would constitute a legal bar to granting the requested
waiver. 38 U.S.C.A. § 5302(c). However, before the
recovery of this indebtedness from the veteran can be
waived, it must also be shown that it will be unfair (that
is, against equity and good conscience) to require him to
repay his debt to the Government. 38 U.S.C.A. § 5302;
38 C.F.R. §§ 1.963, 1.965.
The standard "Equity and Good Conscience" will be applied
when the facts and circumstances in a particular case
indicate a need for reasonableness and moderation in the
exercise of the Government's rights. The decision reached
should not be unduly favorable or adverse to either side.
The phrase "equity and good conscience" means arriving at a
fair decision between the obligor and the Government. In
making this determination, consideration will be given to
the following elements, which are not intended to be all
inclusive:
(1) Fault of debtor. Where actions of the debtor
contribute to creation of the debt.
(2) Balancing of faults. Weighing fault of debtor
against Department of Veterans Affairs fault.
(3) Undue hardship. Whether collection would deprive
debtor or family of basic necessities.
(4) Defeat the purpose. Whether withholding of benefits
or recovery would nullify the objective for which benefits
were intended.
(5) Unjust enrichment. Failure to make restitution
would result in unfair gain to the debtor.
(6) Changing position to one's detriment. Reliance on
Department of Veterans Affairs benefits results in
relinquishment of a valuable right or incurrence of a legal
obligation.
38 U.S.C.A. § 5302; 38 C.F.R. 1.965(a).
In the present case, the overpayment at issue in this appeal
is shown by the evidence of record to have been almost
completely the veteran's fault. He was clearly aware that
the amount of his pension award would depend upon the income
of himself and his family members, and he had been
instructed in writing on several occasions to promptly
report the receipt of all income from whatever source to the
RO. Nevertheless, although he had applied for Social
Security benefits no later than December 1978 and had begun
receiving payments of those benefits in August 1979, he did
not report his receipt of Social Security benefits to the RO
until late October or early November 1981. This delay on
his part is unquestionably the cause of the overpayment to
him of pension benefits which is the subject of the present
appeal.
The appellant has attempted to argue that his fault is
mitigated by his inability to understand English and by the
fact that he consequently asked other parties to fill out
the relevant income reports. However, as previously
mentioned in this decision, the record does not reflect that
either the veteran, a member of his family or another party
acting on behalf of the veteran ever requested VA assistance
of any kind, based upon his alleged inability to understand
English or, for that matter, based upon mental
incompetence. Moreover, even if the relevant income reports
were completed for the veteran by other parties, the
information contained in those reports could only have come
from the veteran himself, and he remains ultimately
responsible for any misrepresentation or misreporting of his
income contained in those reports.
This Section of the Board finds the veteran to have been
overwhelmingly at fault for the overpayment to him of
pension benefits in an amount calculated as $8,428.27.
Moreover, as a result of this overpayment, the veteran has
been unjustly enriched in that same amount at the expense of
the Government.
Generally, the most obvious question for consideration in
deciding a waiver request is whether or not the recovery of
the debt from the appellant would result in undue financial
hardship to himself and his family. In this case, however,
the veteran failed to respond to a request, dated July 12,
1990, by the RO to submit current financial data in support
of his waiver request. Since such information is
exclusively within the knowledge and control of the veteran,
we must therefore presume his financial ability to repay
this debt. Moreover, the evidentiary record certified to
the Board at the present time does reflect other,
fragmentary evidence of the veteran's financial status,
which tends to confirm his ability to repay his indebtedness
to the Government.
For example, a request by the veteran to resume payments of
pension benefits to him was denied by the RO in October 1990
on the grounds that his countable family income from Social
Security benefits at that time was $11,132 per year, which
considerably exceeded the applicable maximum income limit
for pension benefits, $8,864. Although the veteran
subsequently claimed to have substantial amounts of
unreimbursed medical expenses, the veteran has failed to
document those claims.
Moreover, in his communications with the RO concerning his
entitlement to pension benefits dating all the way back to
April 1979, the veteran has consistently maintained that he
and his wife have no outstanding debts of any kind, and that
they have been able over the years to contribute substantial
sums to the payment of the educational expenses of their
three children, all of whom are now considerably beyond the
age of majority. Under these circumstances, and on the
basis of the evidence presently before us, this Section of
the Board is unable to conclude that repayment of his
pension indebtedness to the Government would cause the
veteran or his family undue financial hardship.
A review of the evidence of record discloses no other
element of equity and good conscience which would persuade
this Section of the Board that the Government should forego
its right to the collection of this debt. Basically, the
appellant has been paid improved pension benefits to which
he is not legally entitled. The failure of the Government
to collect this debt would therefore result in the unjust
enrichment of the appellant at the expense of the
Government. Furthermore, debts owed to the Government are
of equal status with those owed to private concerns or
individuals, and the Government is justified in expecting
the appellant to treat this debt in the same manner as he
would any other installment obligation or debt.
A preponderance of the evidence is unfavorable to the
veteran's request for waiver. Consequently, he must repay
to the Government his pension indebtedness in the calculated
amount of $8,428.27.
ORDER
The appeal is denied.
BOARD OF VETERANS' APPEALS
WASHINGTON, D.C. 20420
*
C. J. STUREK
(CONTINUED ON NEXT PAGE)
*38 U.S.C.A. § 7102(a)(2)(A) (West 1991) permits a Board of
Veterans' Appeals Section, upon direction of the Chairman of
the Board, to proceed with the transaction of business
without awaiting assignment of an additional Member to the
Section when the Section is composed of fewer than three
Members due to absence of a Member, vacancy on the Board or
inability of the Member assigned to the Section to serve on
the panel. The Chairman has directed that the Section
proceed with the transaction of business, including the
issuance of decisions, without awaiting the assignment of a
third Member.
NOTICE OF APPELLATE RIGHTS: Under 38 U.S.C.A. § 7266 (West
1991), a decision of the Board of Veterans' Appeals granting
less than the complete benefit, or benefits, sought on
appeal may be appealable to the United States Court of
Veterans Appeals within 120 days from the date of mailing of
notice of the decision, provided that a Notice of
Disagreement concerning an issue which was before the Board
was filed with the agency of original jurisdiction on or
after November 18, 1988. Veterans' Judicial Review Act,
Pub. L. No. 100-687, § 402 (1988). The date which appears
on the face of this decision constitutes the date of mailing
and the copy of this decision which you have received is
your notice of the action taken on your appeal by the Board
of Veterans' Appeals.